# PPMT

Returns the payment on the principal for a given period for an investment based on periodic, constant payments and a constant interest rate.

Syntax

PPMT(rate,per,nper,pv,fv,type)

For a more complete description of the arguments in PPMT, see PV.

Rate     is the interest rate per period.

Per     specifies the period and must be in the range 1 to nper.

Nper     is the total number of payment periods in an annuity.

Pv     is the present value — the total amount that a series of future payments is worth now.

Fv     is the future value, or a cash balance you want to attain after the last payment is made. If fv is omitted, it is assumed to be 0 (zero), that is, the future value of a loan is 0.

Type     is the number 0 or 1 and indicates when payments are due.

Set type equal to If payments are due
0 or omitted At the end of the period
1 At the beginning of the period

Remark

Make sure that you are consistent about the units you use for specifying rate and nper. If you make monthly payments on a four-year loan at 12 percent annual interest, use 12%/12 for rate and 4*12 for nper. If you make annual payments on the same loan, use 12% for rate and 4 for nper.

Example 1

The example may be easier to understand if you copy it to a blank worksheet.

1. Create a blank workbook or worksheet.
2. Select the example in the Help topic.

Note   Do not select the row or column headers.

Selecting an example from Help
1. Press CTRL+C.
2. In the worksheet, select cell A1, and press CTRL+V.
3. To switch between viewing the results and viewing the formulas that return the results, press CTRL+` (grave accent), or on the Tools menu, point to Formula Auditing, and then click Formula Auditing Mode.
A B
Data Description (Result)
10% Annual interest rate
2 Number of years in the loan
2000 Amount of loan
Formula Description (Result)
=PPMT(A2/12, 1, A3*12, A4) Payment on principle for the first month of loan (-75.62)

Note    The interest rate is divided by 12 to get a monthly rate. The number of years the money is paid out is multiplied by 12 to get the number of payments.

Example 2

The example may be easier to understand if you copy it to a blank worksheet.

1. Create a blank workbook or worksheet.
2. Select the example in the Help topic.

Note   Do not select the row or column headers.

Selecting an example from Help
1. Press CTRL+C.
2. In the worksheet, select cell A1, and press CTRL+V.
3. To switch between viewing the results and viewing the formulas that return the results, press CTRL+` (grave accent), or on the Tools menu, point to Formula Auditing, and then click Formula Auditing Mode.
A B
Data Description (Result)
8% Annual interest rate
10 Number of years in the loan
200,000 Amount of loan
Formula Description (Result)
=PPMT(A2, A3, 10, A4) Principal payment for the last year of the loan with the above terms (-27,598.05)

Applies to:
Excel 2003